State hires more people to investigate unemployment fraud

State officials are hiring more staff to review unemployment claims and look for fraud.

Iowa Workforce Development director Teresa Wahlert says in 2010 five of the nine investigators in the investigative unit took early retirement incentives and left the agency.

“So we went down to four investigators,” Wahlert says.

The department operated at that barebones staff level for the past three-and-a-half years. However, in May, Wahlert started hiring more investigators for the bureau and by February she plans to have 11 investigators on staff. Wahlert says she’s not worried some fraudulent claims have gone unnoticed during the past few years when the investigative unit was understaffed because Iowa reviews cases longer than the federal government requires.

“I’m not concerned about that because we investigate our cases for over 10 years,” Wahlert says. “So even though the federal law really cuts things off at three years, we in Iowa do go the extra step, so we will continue to be investigating fraud cases for at least 10 years in arrears, as we do overpayments.”

The increase in fraud investigators comes as the number of unemployment claims submitted to Iowa Workforce Development has dropped, due to the improving economy.

In 2013 the agency reported that about six percent of unemployment claims filed in Iowa had some sort of mistake or contained intentional fraud. Iowa Workforce Development recently signed a contract with a company that uses its computer software to flag suspected fraud. For example, sham companies are being set up around the country, claiming to have hired workers, then claiming layoffs — just to collect the unemployment checks. Federal officials estimate about 30 percent of unemployment fraud comes from people who were out of work, but continue to receive unemployment benefits after they’ve landed another job.